Are You Using One Of Your Credit Card’s Most Valuable Benefits?

I’m not opposed to using credit cards. In fact, when used responsibly, they offer many valuable benefits.

In a minute, I’m going to highlight one particular benefit that I’ve found to be especially valuable—one that I’m guessing is probably vastly underutilized. But first, here’s my overarching point of view about credit cards.

While there are some people who would be better off not using them, most can be trusted to use credit cards responsibly. That means four things:

• Use a budget and only pay with plastic according to the parameters in your budget. If you budgeted $80 for clothing per month, you can charge $80 worth of clothing this month.
• Treat credit card purchases like you would treat cash transactions and record the purchase right away. In other words, if you use a credit card to buy a sweater today for $50, that $50 counts against this month’s clothing budget.
• Always pay your bill in full.
• If you can’t or won’t take the first three steps, don’t use credit cards.

Okay, on to the benefit: Price protection.

Some cards give it fancier names, such as Price Rewind, but whatever it’s called, price protection works the same way. If you buy something with that card and then 60-90 days later you find the item for less, the card will credit your account with the difference.

In the last eight months, I’ve used this benefit to get more than $260 back on $1,630 of purchases—a laptop computer, a DSLR camera, a telephoto lens, and a multi-port HDMI selector for our TV. I bought the computer, camera, and lens during what I thought were great sales. But a couple of weeks later, I found even better prices on each item and got money back.

The HDMI selector was a somewhat spontaneous purchase made in a hurry. Normally, I would have done some price comparisons, but knowing about the price protection benefit on the card I used, I went ahead and then got money back later.

And here’s something I have found interesting about using this benefit. In three of the four purchases—the most expensive ones—the sites I used to demonstrate a lower price were sites I had never heard of. In fact, I would not have made the purchases through the sites since I wasn’t familiar with them. But they worked just fine in helping me demonstrate that the items I bought were being offered for less than I paid.

To get money credited to my account, I had to scan and upload my receipts and then upload a screen capture of the lower price offers. Within just a few days, the request for each credit was processed and approved, with the credit showing up a short time later.

Cards that offer price protection typically limit the amount of the credit per purchase (usually $250-$500), cap the number of claims or total amount per year, and exclude certain items.

Price protection has become one of my favorite credit card benefits. It helps me avoid the regret of buying something only to then see it advertised for less.

Does your credit card offer price protection? If so, are you making full use of it?